North Carolina’s High Speed Effort to Spend Taxpayer’s Money

North Carolina State Transportation Secretary Gene Conti defended the recent Southeast High-Speed Rail Corridor proposal by claiming that North Carolina has a “good chance of winning some of the $8 billion in federal economic stimulus funding allocated to fast trains.” Conti continued, “North Carolina would be one of the most profitable venues for high-speed rail, [and] people are starting to see that [our] corridor would generate the most revenue.”1

Get the Facts: The Southeast High-Speed Rail Corridor

The corridor is a proposed fast-train route from Charlotte to Washington via Greensboro, Raleigh and Richmond. It follows active lines between Charlotte and Raleigh. The route between Raleigh and Richmond would revive an abandoned CSX corridor through Norlina and South Hill, VA., where there is no train service now.

How fast will it be?

The proposal calls for top speeds of 110 mph and an average of 85 mph. Amtrak trains now in North Carolina have a top speed of 79 mph and an average of 48 mph.

What would it cost to build the whole thing?

Recent estimates put the capital cost at $5 billion to $6 billion. Most of this would be spent to buy right of way, replace curved tracks with straighter tracks, build passing sidings or double tracks where there are single tracks now, and build bridges over roads to eliminate at-grade crossings.

First off, if such a high-speed rail project would indeed be “profitable,” why are government subsidies needed?

President Obama revealed the High-Speed Rail Strategic Plan in April 2009 proposing an $8 billion down payment, provided in the American Recovery and Investment Act (ARRA), to then be followed by $1 billion in additional grants annually over the next 5 years.2

July 10 was the due date for pre-applications from states to the FRA for inclusion in the high speed project corridor routes. If North Carolina, as Conti suggests, enters into this bidding war a state-drafted proposal is required outlining the state’s fiscal and institutional capacity to carry out and manage the project.

The ramifications of a North Carolina high speed train on our over-stretched budget should be considered before North Carolina jumps on this spending train.

According to new report released by the John Locke Foundation and authored by Randal O’Toole, senior fellow at the Cato Institute,3 “The average North Carolinian will take a round trip on a high-speed train only once every 27 years.” The report continues, “Because of a premium fare structure and downtown orientation, the main patrons of high-speed trains will be the wealthy downtown workers, such as bankers, lawyers and government officials.”4

To upgrade the nearly 400 miles of North Carolina tracks in the Federal Railroad Administration’s plan taxpayers will pay more than $1.3 billion, O’Toole said. That’s nearly $150 for every North Carolina resident. Money some think the state is ready to spend.

On April 16, President Obama cited clogged highways and overburdened airports as stifling our nation’s economic growth.5 It would appear that North Carolina’s transportation secretary feels the same way.

However, according to O’Toole’s report, “The average American will ride these trains less than 60 miles per year, or about 1/70th as much as the average American travels on interstate freeways.” It seems people are not easily persuaded to leave the convenience of their Fords behind for the inflexible routes and schedules of high-speed trains.

North Carolina’s fascination with trains is neither new nor forgotten. The North Carolina Railroad Company owns and manages the current 317 mile rail corridor that transports 70 freight trains and eight passenger trains daily from Morehead City to Charlotte.6 In 1998, North Carolina agreed to buy out the remaining private shares of NCRR stock, making the pre-civil war railroad a privately run company, fully owned by the state.

Beginning in the mid-90s, officials in the Raleigh-Durham Triangle area, and in Charlotte, began pushing for light rail projects. In 2004, federal planners rejected the Triangle’s $810 million light rail proposal because the projected population density and ridership numbers did not merit such large spending.7

Private business incentives are second to North Carolina’s fantasy of railroad transportation even a decade later as NCPP is still owned by the state. Now, the introduction of a high speed rail will increase taxes to subsidize the commute of downtown bankers on an already state-owned train. While Secretary Conti wants North Carolina to be included in federal stimulus money, constructing high speed trains is not the proper route to take.

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Discussion

North Carolina submitted an application for inclusion in the High Speed Rail Proposal on July 10. The State’s application outlined 34 seperate two-year projects costing a total of $913 million. Details of the proposal include; $100 million to finish double-tracking the N.C. Railroad line between Greensboro and Charlotte, more than $200 million for just Charlotte-area upgrades, and $403 million to finish work between Raleigh and Richmond.

U.S. transportation secretary, Ray LaHood, confirmed that 40 states submitted applications for a combined $93 billion- well over the $8 billion budgeted in Obama’s stimulus package. You can read the full report here.

If you have a complaint about rail needing government subsidies, then why don’t you propose de-funding roads and air, since that is the only ‘free market’ solution? Otherwise it would be ‘big’ government vs. passenger rail. Passenger rail made a profit before roads and airlines, when have either done the same?

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